The June employment data for Australia reveals a cooling job market beneath a strong headline, and the Reserve Bank of Australia (RBA) is expected to look past the headline into the detail, Jarden said in a Thursday note.
Australia's seasonally adjusted unemployment rate remained flat at 4.4% in June compared with the previous month, data from the Australian Bureau of Statistics (ABS) showed. The total number of employed people increased by 76,300, bringing the total to 14.8 million.
The flat jobless rate came from participation rising alongside employment rather than the market tightening. Part of the increase was people who had lined up jobs in May, according to ABS, and the underlying pace of hiring has slowed sharply over the year.
The three-month average employment growth slowed to around 0.25% in the quarter to June, compared with around 0.6% in the same period in the prior year.
The strength in the jobs data was also narrow based on regions, with New South Wales and Western Australia seeing a 0.9% and 1% rise in employment, and the unemployment falling to 4% and 4.2%, respectively. The rest were softer.
Underemployment rose 0.2 percentage points to 6.5%, rising 0.6 percentage points over the year, and broad under-utilization reached almost 11%, up around 0.7 percentage points over the year. This is the clearest signal in the release, and it shows spare capacity is still widening, Jarden said.